ValOre plans 2022 exploration at Angilak

In a move welcomed by investors, ValOre Metals Corp. plans to return to Nunavut to resume exploring its Angilak uranium project in 2022.

A district-scale property covering a 59,483-hectare (146,982 acres) expanse in south-central Nunavut, Angilak hosts drill-confirmed uranium mineralization along 40 kilometers (25 miles), including the prospective 3,000- by 1,500-meter Lac 50 Trend and multiple un-drilled targets property-wide.

ValOre says the Lac 50 Trend deposits comprise Canada's highest-grade uranium resource outside of the Athabasca Basin in Saskatchewan and ranks as one of the world's highest-grade uranium resources.

The Canadian junior's predecessor company, Kivalliq Energy Corp., reported an NI 43-101 inferred resource for Angilak of 2.83 million metric tons grading 0.69% (43.3 million pounds) triuranium octoxide, a uranium compound more commonly referred to as U3O8. The 2013 resource, based on 89,572 meters in 589 drill holes, reflected a 200% increase from an initial inferred resource calculated for the project.

In addition to uranium, the Lac 50 Trend contains significant quantities of silver, molybdenum, and copper as outlined in the resource and is interpreted as a basement-hosted, vein-hydrothermal type, unconformity-associated uranium deposit.

ValOre has invested more than C$55 million at Angilak on resource delineation and exploration drilling (89,572 meters in 589 drill holes), metallurgy, geophysics, geochemistry, and logistics across the large land package. This work supported the development of the significant Lac 50 Trend NI 43-101 inferred resource estimate.

Strong investor interest

Investors recently demonstrated substantial interest in the Angilak project in a financial offering announced by ValOre on Oct. 25. The junior initially offered C$7 million in ownership units that were upsized a day later to C$9 million before eventually attracting C$11 million in gross proceeds in mid-November.

"We are thankful for the ongoing support of existing ValOre shareholders and of this financing. Raising funds at this time will allow us to return to ValOre's Angilak Property uranium project in the 2022 season with a significant and material exploration budget and a well-planned program," said Jim Paterson, ValOre's chairman and CEO.

Situated on Inuit-owned lands in southern Nunavut, Angilak is a vast underexplored district believed to have tremendous upside potential.

Paterson said ValOre has forged strong relationships not only with sophisticated resource sector investors but also with Nunavut's Inuit association, Nunavut Tunngavik Inc., for both Angilak and the company's Baffin Island gold properties.

ValOre was the first company to sign a comprehensive agreement to explore for uranium on Inuit Owned Lands in Nunavut.

Well-reviewed exploration plans

The 2022 work will include a multi-faceted campaign of core drilling; enzyme leach soil sampling; geophysics, including ground magnetics and very low frequency electromagnetics (VLF-EM); as well as district-wide prospecting, mapping, and sampling.

"The potential for significant resource expansion and discovery at Angilak is exceptional, including 14 targets with high-grade U3O8 drill intercepts, which span 60 kilometers (37 miles) of underexplored prospective geological trend," said Colin Smith, ValOre's vice president of exploration.

ValOre characterizes the Angilak exploration targets as three classes:

• Lac 50 Trend Resource Expansion – four targets adjacent or contiguous to inferred resource zones.

• Target Advancement – 10 targets to follow-up U3O8 drill intercepts at zones not included in the inferred mineral resource.

• New Discovery – 20 targets that merit drilling.

Complete geophysical and geochemical datasets have been reprocessed, re-interpreted, and re-integrated into the Angilak geological and targeting model. In addition, 466 square kilometers (180 square miles) of new spectral data and high-spatial-resolution imagery cover 100% of the high-priority targets and prospective basin margin.

ValOre also said areas along two major trends have been identified for completion of ground magnetics, VLF-EM, and geochemical sampling.

The Lac 50 Trend hosts significant resource expansion potential, with multiple high-grade U3O8 extension targets remaining wide open. Mineralization occurs as southwest plunging shoots, which, by drilling, have been traced to a maximum vertical depth of about 380 meters and along a strike length of more than six kilometers.

Lac 50's J4 Zone contributes 15.3 million lb of uranium in material averaging 0.75% U3O8, 30.1 grams per metric tons silver, 0.20% molybdenum, and 0.26% copper to the overall Lac 50 Trend resource. J4 remains open down-plunge, and reprocessed ground VLF-EM data highlights a distinct off-set and interpreted continuation of the uranium-rich conductor immediately to the east-southeast of the resource zone.

The junior said a similar resource upside has been identified at Lac 50's Eastern Extension, Western Extension, and Main Zone, all of which will be considered for targeted expansion, drilling.

Rocky road for uranium

While the Angilak project is considered an attractive opportunity, heightened investor interest also may stem from several recent changes in the uranium sector.

In the aftermath of the nuclear meltdown at the Fukushima Daiichi nuclear power plant in 2011, many countries established a moratorium on nuclear energy. This fueled a prolonged decline in uranium prices that plunged to a low of US$18 per pound at the end of 2016, down 75% from the US$71/lb level pre-Fukushima.

For miners, uranium's performance has been even worse, with a bear market lasting into 2020. Uranium mines began to cut production in 2017 and have significantly reduced the world supply of the mineral. The pandemic further hampered output as some companies downsized their operations, while others temporarily suspended production.

But these changes did not trigger the start of the favorable market currently underway in uranium-related equities, observers say.

One factor is a growing realization that nuclear energy must comprise a substantial slice of the sustainable energy pie if many countries are to meet their goals of reducing harmful effects of climate change in the near future.

They cite instead a massive inflow into mining stocks from institutional investors in anticipation of a pick-up in demand for physical uranium.

For example, Sprott, a Canada-based global investment manager, took over Uranium Participation Corp. and renamed it Sprott Physical Uranium trust in April.

While the previous trust held a static amount of uranium, Sprott's approach is a more aggressive strategy, which drives up prices and attracts more investors to buy the trust.

Uranium development companies, meanwhile, are raising capital to buy uranium for storage.

The result: Climbing prices. The price of uranium, about US$28/lb. at the end of March, had exceeded US$50 in September, reflecting a dramatic increase.

Uranium prices, however, are still below the level at which existing mines can afford to increase production (US$60-US$70). As a result, the market remains under-supplied, putting additional upward pressure on uranium prices.